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Fed invites Congress to review AIG rescue

Washington -- U.S. Federal Reserve Chairman Ben Bernanke said he would welcome a congressional review of the central bank's bailout of American International Group Inc.

Bernanke said in a letter to Acting Comptroller General Gene Dodaro that the Fed would allow the Government Accountability Office access to "all records and personnel necessary" for an audit of the AIG bailout, The Wall Street Journal reported Tuesday.

The letter could be a step ahead of a Congressional mandate to open the books concerning AIG, as a House committee has scheduled a hearing next week to investigate why some large banks were paid in full on credit default swaps that involved taxpayer funding.

Bernanke's letter said he would open the records "to afford the public the most complete possible understanding of our decisions and actions in this matter and to provide a comprehensive response to questions that have been raised."

Bernanke is currently lobbying to stop passage of a bill that would mandate the GAO review Fed policy decisions made by members of the Open Market Committee.

Bernanke contends the Fed must maintain autonomy on setting interest rates and keep the decisions separate from political pressures or public popularity.

Copyright 2010 by United Press International.

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